1. Understanding Services
“Customer service” is a term frequently mentioned in everyday life, but not everyone fully understands its core value and objectives. So, what is “customer service”? How does the role of customer service impact customers, businesses, and society? Let’s explore the answers with HRDC!
First, customer service is a concept encompassed by a broader term, “service.” According to Philip Kotler, service (S) is any activity or benefit that one party provides to another, where the offering must be intangible and does not result in the ownership of any physical product. The production of service may or may not be associated with a physical product.
Services have several typical characteristics, such as: intangibility, inseparability, variability, perishability, and non-transferable ownership. Essentially, services have the following attributes:
- Service is a process: It involves the execution of activities and behaviors based on intangible factors, aiming to solve the relationships between a business and its customers.
- Service is a process: It occurs in a defined sequence with multiple stages, sometimes including additional services or add-ons in each phase.
- Service is linked to performance/results: Each service is associated with the goal of delivering value to the consumer. The performance here refers to the benefits, value, and added value that customers receive after using the service.
Accordingly, customer service is a subset of services within the category of Commercial Services. Therefore, this type of service involves human work, including physical labor, knowledge, professional skills, organizational ability, and commercial expertise. Additionally, its production process does not generate conventional goods but creates services (special goods) by meeting people’s needs (for others), beyond the goods provided by agriculture and industry.
2. Customer Service and Its Role
Customer Service (CS) refers to the support services that a business provides to customers before, during, and after purchasing a product or using a service. It can also be understood as a set of services aimed at ensuring that customers’ needs and desires are met. This is a critical aspect for businesses in retaining their current customers. It is also accurate to say that customer service is a subset of the customer experience (CX).
Customer service is a very important step but not the only factor in customer retention. If the service is good but the product is not, it cannot make customers stay loyal to the brand.
According to marketing managers, a product includes all tangible and intangible elements that a company offers to its customers. It is often divided into three levels: (1) Core benefit, (2) Actual product, and (3) Augmented benefit. The essence of customer service is considered to be the augmented benefit level.
Based on the scale and development speed of the business, customer service will have the following roles:
- Customer service as an activity: This is the basic level. Customer service will primarily focus on processing orders, issuing invoices, and resolving complaints and issues from customers.
- Customer service as a measure of performance: This level emphasizes results. Defining outcomes numerically allows businesses to measure customer satisfaction and achieve real satisfaction.
- Customer service as a philosophy: This is the highest level, where customer service is elevated to a commitment to providing satisfaction through superior customer service. This perspective aligns with the current trend: emphasizing the management of both quantity and quality within a company.
2.1 The Role of Customer Service for Customers
- Meeting needs and desires when using products or services.
- Creating satisfaction and a positive impression during the service experience, shopping, or consumption.
- Providing comfort and peace of mind throughout the process before, during, and after the purchase.
- Creating the impression that the customer is valued and well-supported.
- Sparking interest in learning more and experiencing more services or products.
- Motivating customers to share and recommend products or services with family, friends, and acquaintances.
2.2 Role of Customer Service for Businesses, Stores, or Service Providers
Based on the scale and development speed of the business, customer service plays the following roles:
- Customer service as an activity: This is the basic level. Customer service primarily involves handling orders, issuing invoices, and addressing customer complaints and issues.
- Customer service as a measure of performance: This level focuses on outcomes. Defining results numerically allows businesses to measure customer satisfaction and achieve genuine satisfaction.
- Customer service as a philosophy: This is the highest level, where customer service becomes a commitment to provide satisfaction by offering superior services. This perspective aligns with the current trend of prioritizing both quantity and quality management within companies.
- Creating a strong impression of the brand, products, and services: A well-executed customer service experience leaves a lasting impact on customers’ perceptions of the business.
- Influencing customers’ buying habits and loyalty: This leads to an increase in a stable customer base, maintaining a solid foundation for the business.
- Attracting new potential customers: Effective customer service helps expand the market and target audience for products and services.
- An effective marketing tool: Customer service can be an essential part of promoting the brand, product quality, and services.
- A highly effective competitive weapon in the 4.0 industrial era: In today’s digital age, customer service plays a critical role in maintaining a competitive edge.
- Significant impact on sales and revenue: Well-executed customer service directly influences product/service sales and overall business revenue.
2.3 Role of Customer Service in the Country and Society
- Influencing consumption trends and demand: Customer service plays a role in shaping consumer behavior and driving demand for goods and services.
- Stimulating consumer demand: By providing excellent service, businesses can encourage more spending and increase consumption.
- Creating healthy competition for business development: Strong customer service encourages businesses to improve, fostering a competitive yet constructive business environment.
- Impacting citizens’ satisfaction and peace of mind: Good customer service contributes to consumer confidence in products and services, enhancing overall societal well-being.
- Attracting foreign investment: Companies that prioritize customer service are more likely to be seen as trustworthy, making them attractive to international investors.
- Reducing conflicts and tensions between customers, businesses, and the government: Effective customer service helps minimize disputes, leading to more harmonious relationships between all parties involved.
HRDC collection and synthesis.
